FEARS of a dock strike have inspired more and more shippers to look to the Eastern Seaboard for ports of entry, says JLL's [Jones Lang Lasalle] annual seaport real estate outlook, which shows more rapid east coast growth.
Of the seaports ranked in the JLL report, the west coast volumes were 6.8 per cent below 2007 peak levels, while shipping volumes on the east coast exceeded 19.1 per cent.
"Shippers are turning to the Suez Canal to reach US east coast population centres," said the managing director of JLL's Ports Airports and Global Infrastructure (PAGI) group, Rich Thompson.
"This route helps offset the risks associated with potential disruption and costs of the Panama Canal and/or delays and potential disruptions at west coast ports such as LA-Long Beach," Mr Thompson said.
"Last year was a banner year for shipping volumes, which were up 3.3 per cent on the previous peak seen in 2007," he said, reported the American Journal of Transportation.
The Port of New York/New Jersey topped JLL's Index for the third consecutive year. The Port of Long Beach placed second, while Los Angeles rounds off the top three.
Savannah, with consistent volume growth over the past decade, continues to lead JLL's second tier of ports. While Jacksonville, previously in the second tier, now leads the index's third group owing to flat annual container volume and a lack of space.
"Consumer goods are driving the need for an alternative to west coast ports. As shippers look to store inventory stateside in the lead-up to the holiday season, warehouses near ports have become a hot commodity," said the report.
"Industrial real estate within a 15-mile radius of the 13 seaports tracked in the study accounts for 1.3 billion square feet - 11.3 per cent of the nation's total 11.6 billion square feet.
"The average vacancy rate within this niche is only 7.7 per cent, and several markets have planned and active developments under way. Most large requirements for modern space however will end up further inland," said the report.
"JLL is tracking 267.4 million square feet in active industrial space requirements in the US, and nearly 60 per cent are based in markets within a three-hour drive-time of the seaports," said Mr Thompson.
"To increase supply, nearly half of the nation's 122.8 million square feet of construction activity is located within three hours of a major seaport, with the bulk found in the Inland Empire [Southern Cal], Central Pennsylvania and Houston," he said.
"While the east coast industrial real estate market has yet to see a tangible impact of the cargo shift, we anticipate a rebalancing in the next few years," said Mr Thompson.
"This will be evident when New York/New Jersey can start receiving the super-sized postpanamax ships, and Miami and Jacksonville come online in 2015. The need for logistics and warehousing space is certain to grow."
Logistics suppliers and transportation providers are turning to intermodal solutions to connect port cities with major population centres. To date, 30 inland ports have opened or have been announced since 2000, including 19 since 2008 alone, said the report.
"A notable beneficiary is the Port of Savannah, which ships most of its cargo by rail to Atlanta and was ranked the 'Fastest Growing Port' in the first half of 2014, according to PIERS research. Charlotte is also evolving as a hub market thanks to a new inland port connecting to Charleston." said the report.
Source : HKSG.